Disaster Preparedness for Small Business Contractors

By Liz Kallen, Rockland Economic Development Corporation PTAC

Natural Disasters can be a time of crisis or opportunity for small business government contractors. According to the Federal Emergency Management Agency (FEMA) www.Ready.gov website, up to 40% of businesses affected by a natural or human-caused disaster never reopen (Source: Insurance Information Institute). Several reasons contribute to this statistic including the fact that customers outside the disaster area need products and services to be provided on time and customers inside the disaster area can only wait a short time for their vendors to get up and running again. Failure to be functional is very costly.

Therefore, it is important that vendors be proactive and prepared. They need to understand both what steps to take so they can function during the situation and how to capture some of the opportunities that arise out of disasters.

All government contractors are expected to have a disaster plan in place that includes how they will resume work on their contracts; such planning can prove critical to commercial vendors as well. Take advantage of the Five Steps to Developing a Plan and other valuable resources provided by FEMA. Time and effort spent up front developing such a plan – which should include identifying regulations, assessing hazards and risks and analyzing their likely impact on your business, and determining how you will address such issues as resource management, crisis communications and business continuity – will make your business stronger in the short term and may well determine your ability to survive in the event of a catastrophe.

Government contractors should know that the Termination For Default (T4D) FAR Clause makes them responsible for completing the contract on time unless the cause of delay is unforeseeable and beyond their control (both conditions apply in order to be excused from T4D). The Government will impose that clause, and small businesses without a mitigation plan may go bankrupt because of it. Some disasters, hurricanes for example, are forecast several days in advance. If the organization has a plan for moving their operations to “high ground” or subcontracting to a shop in a safer region, they probably will have time to implement the plan before the storm hits. Contractors should take the conservative road and have a good Disaster Plan or run the very high risk that a disaster will not excuse them from T4D.

Since 2009, Liz Kallen has been Program Manager of the Rockland Economic Development Corporation PTAC in Pearl River, New York. Prior to that she she was President of a small firm (which she founded in 1999) that designed and facilitated interactive learning experiences.

More about
Procurement Technical Assistance Centers (PTACs)

Ninety-eight PTACs – with over 300 local offices – form a nationwide network of procurement professionals dedicated procurement professionals working to help local businesses compete successfully in the government marketplace. Funded under the Defense Logistics Agency’s Procurement Technical Assistance Program through cooperative agreements with state and local governments and non-profit organizations, PTACs are the bridge between buyer and supplier, bringing to bear their knowledge of both government contracting and the capabilities of contractors to maximize fast, reliable service to our government with better quality and at lower costs.

PTACs provide a wide range of government contracting help – most free of charge!